The Undertaker's story

Not many surprises in this memoir-cum-essay except that it is an unexpectedly enjoyable read

AS CHAIRMAN of the Federal Reserve for the better part of two decades, Alan Greenspan was the world's most influential economic policymaker. Down the years he was skilful or lucky, or both, since the American economy fared well under his stewardship. But nobody ever accused Mr Greenspan of being a lively speaker, let alone a born storyteller, and no reviewer could approach this volume with anything but a heavy heart and a sense of duty.

“The Age of Turbulence” is a dull title, tending to confirm one's fears, and that risible subtitle, “Adventures in a New World”, is fooling nobody. Yet, despite everything, the book turns out to be first-rate. It engages on different levels: it is intelligent in a way that few popular books on economics manage or even try to be; and, wonder of wonders, it is a good read. No doubt, Mr Greenspan had help with the writing: he acknowledges Peter Petre, a talented co-writer, as a collaborator. For this one can only be grateful. Who would have guessed that 500 pages in Mr Greenspan's company could slip by so easily?

Good or bad, the book for which Penguin reportedly advanced $8m is news. Nearly two years after his retirement, reporters' zeal for misdivining Mr Greenspan's meaning is (as he would once have put it) not markedly impaired. Once the Wall Street Journal had cunningly evaded strict pre-launch security by buying a copy in a bookshop, the race was on to find shocking disclosures.

Two were seized upon. First, the book criticises George Bush for letting public spending rip. It would have been shocking if Mr Greenspan, a libertarian Republican, had said anything else. As for the other, the Washington Post got the scoop: it declared one of its crack team of readers to be the first to reach page 463, where Mr Greenspan says that the Iraq war was “largely about oil”—a remark that subsequently “proved controversial”, the newspaper noted. But the words were taken out of context. Mr Greenspan was not talking about an intended oil grab, but only meant to say that Iraq matters as much as it does because of where it is. This was not especially shocking either.

There is nothing sensational in “The Age of Turbulence”. It is better than that. It combines two different narratives in a surprisingly adept way. The book's first half is a memoir; the rest is essays on the main economic issues confronting governments over the next few decades. Mr Greenspan's take on the future is informed by his earlier experience and rooted in his intellectual development. Both parts work fine; the best thing is that they sit so well together.

Mr Greenspan turns out to be a more interesting character than you might have guessed. He started out as a professional saxophone player, albeit one with a passion for corporate accounting. While the rest of the band sloped off to get stoned, he did his business-studies homework and wrote up their tax returns. For a time he trained with Stan Getz, a renowned saxophonist, and writes of recognising at once an inborn talent that he could never match, no matter how hard he worked.

Later he joined the circle surrounding Ayn Rand, a libertarian novelist-philosopher. In an early encounter, she baffled him into affirming the possibility that he did not exist. She called him the Undertaker because of his gloomy demeanour, and was to be heard for a time asking of her new follower: “Well, has the Undertaker decided whether he exists yet?”

Mr Greenspan relates America's economic history since the 1950s through his experience in business and in government, and then at the Fed. For those familiar with the record, little is new, but those who are not would struggle to find a better account. The facts and anecdotes are handled deftly, without preening.

The pace slows in the book's forward-looking second half. The tour of issues—China's prospects, Russia's prospects, Latin America's prospects, demographics, corporate governance, inequality, energy and so on—sometimes threatens to become a trudge. But Mr Greenspan knows plenty, has limitless curiosity about economic facts and figures and reflects deeply on it all. He is a good guide.

Economists are divided on Mr Greenspan's legacy. Many have nothing but praise, but some argue (and this newspaper has tended to agree with them) that he had a habit of keeping interest rates too low for too long, tolerating and even encouraging bubbles in the stockmarket and the housing market.

On this view, the maestro is deeply implicated in the financial markets' current difficulties. He mentions these charges and says why he did as he did, but not in much detail. He never seems prickly or defensive. He admits to many mistakes: in supporting the administration's tax cuts without adequately emphasising the need for spending restraint; and in advocating the recklessly (as it turned out) expanded use of adjustable-rate mortgages. But he is unrepentant and none too informative on whether central banks should act pre-emptively against asset-price inflations.

To go into that issue thoroughly would have made the book more technical than Mr Greenspan presumably wished it to be. He owed the publisher a popular book and he apparently feels no need to vindicate himself. If “The Age of Turbulence” has a gap, this is it—but the readers for whom the book is intended are unlikely to mind. They are likely, in fact, to be delighted. Sales are running at a torrid pace. Whether they are fast enough to catch up with an $8m advance is another matter.